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Britain’s economy is performing better than expected following the EU referendum, the Bank of England has said, spurring hopes that growth will beat its previous gloomy forecasts.

Interest rates could still be cut further if the economy needs another boost, however, and the Bank’s Monetary Policy Committee said it remains on standby to chop its base rate below its current record low of 0.25pc.

Economists believe that means rates could hit 0.1pc by the end of this year, an unprecedented position for British interest rates.

The Bank had slashed its economic forecasts just last month, predicting the UK economy would almost grind to a halt, with growth slumping to just 0.1pc in the third quarter....